Northeast Bancorp ("Northeast" or the "Company") (Nasdaq:NBN), a
Maine-based full-service financial services company and parent of
Northeast Bank (the "Bank"), today reported net income of $1.8
million, or $0.18 per diluted common share, for the quarter ended
March 31, 2015, compared to net income of $437 thousand, or $0.04
per diluted common share, for the quarter ended March 31, 2014. Net
income for the nine months ended March 31, 2015 was $5.0 million,
compared to $2.2 million for the nine months ended March 31, 2014.
The Board of Directors has voted to amend the existing stock
repurchase program to authorize the Company to purchase an
additional 500,000 shares of its common stock, representing 5.1% of
the Company's outstanding common shares or approximately $4.7
million based on the Company's closing price on April 29, 2015.
Under the existing program, implemented in April 2014, the Company
has purchased 783,336 shares through April 29, 2015 and 86,664
shares remain available for repurchase under the program on that
date, prior to the 500,000 share increase in the repurchase plan.
The amended stock repurchase program will expire on April 30,
2017.
The Board of Directors has also declared a cash dividend of
$0.01 per share, payable on May 26, 2015 to shareholders of record
as of May 12, 2015.
"We continue to make progress in the execution of our business
plan," said Richard Wayne, President and Chief Executive Officer.
"We've begun to see results from our new SBA Lending Division, with
SBA loan originations totaling $9.4 million for the quarter. It was
also a strong quarter for transactional income, which totaled $2.7
million and contributed to our 4.8% net interest margin for the
period. As always, we remain focused on the further leveraging of
our operating infrastructure and the effective deployment of our
capital."
"With regard to capital, we continue to believe that our shares
are undervalued, based on current market prices," said Mr. Wayne.
"Our goal in implementing the amendment to the existing stock
repurchase program is to continue to enhance shareholder
value."
At March 31, 2015, total assets were $832.9 million, an increase
of $71.0 million, or 9.3%, compared to June 30, 2014. The principal
components of the change in the balance sheet follow:
1. The loan portfolio – excluding loans held for sale – grew by
$62.8 million, or 12.2%, compared to June 30, 2014, the result of
net growth of $67.1 million in commercial loans purchased or
originated by the Bank's Loan Acquisition and Servicing Group
("LASG"), offset by a $4.3 million decrease in the Bank's Community
Banking Division loan portfolio.
New loans generated by the LASG totaled $35.8 million and $156.1
million for the three and nine-month periods, respectively, ending
March 31, 2015. The quarterly growth in LASG loans consisted of
$5.1 million of purchased loans, at an average price of 92.3%, and
$30.7 million of originated loans. Small Business Administration
("SBA") loans originated during the quarter totaled $9.4 million,
of which $3.1 million were sold in the secondary market.
Residential and consumer loan production sold in the secondary
market totaled $20.0 million for the quarter.
As discussed in the Company's prior SEC filings, the Company
made certain commitments to the Board of Governors of the Federal
Reserve System in connection with the merger of FHB Formation LLC
with and into the Company in December 2010. The Company's loan
purchase and commercial real estate loan availability under these
conditions follow.
|
|
|
Basis for |
|
|
Regulatory Condition |
Condition |
Availability at March 31, 2015 |
|
|
(Dollars in millions) |
Total Loans |
Purchased loans may not exceed 40% of total
loans |
$ 62.9 |
Regulatory Capital |
Non-owner occupied commercial real estate
loans may not exceed 300% of total risk-based capital |
$ 155.2 |
An overview of the Bank's LASG portfolio follows:
|
LASG Portfolio |
|
Three Months Ended March
31, |
|
2015 |
2014 |
|
Purchased |
Originated |
Secured Loans to Broker-Dealers |
Total LASG |
Purchased |
Originated |
Secured Loans to Broker-Dealers |
Total LASG |
|
(Dollars in thousands) |
Loans purchased or originated
during the period: |
|
|
|
|
|
|
|
Unpaid principal balance |
$ 5,484 |
$ 18,760 |
$ 12,000 |
$ 36,244 |
$ 19,050 |
$ 11,158 |
$ -- |
$ 30,208 |
Net investment basis |
5,063 |
18,697 |
12,000 |
35,760 |
16,300 |
11,158 |
-- |
27,458 |
|
|
|
|
|
|
|
|
|
Loan returns during the period: |
|
|
|
|
|
|
|
|
Yield |
12.87% |
5.67% |
0.46% |
9.37% |
9.51% |
6.95% |
0.61% |
8.11% |
Total Return (1) |
13.60% |
5.67% |
0.46% |
9.81% |
10.39% |
7.10% |
0.61% |
8.71% |
|
|
|
|
|
|
|
|
|
|
|
|
Nine Months Ended March
31, |
|
2015 |
2014 |
|
Purchased |
Originated |
Secured Loans to Broker-Dealers |
Total LASG |
Purchased |
Originated |
Secured Loans to Broker-Dealers |
Total LASG |
|
(Dollars in thousands) |
Loans purchased or originated
during the period: |
|
|
|
|
|
|
|
Unpaid principal balance |
$ 67,909 |
$ 50,315 |
$ 48,000 |
$ 166,224 |
$ 53,044 |
$ 54,722 |
$ -- |
$ 107,766 |
Net investment basis |
57,896 |
50,236 |
48,000 |
156,132 |
46,267 |
54,722 |
-- |
100,989 |
|
|
|
|
|
|
|
|
|
Loan returns during the period: |
|
|
|
|
|
|
|
|
Yield |
12.97% |
6.91% |
0.47% |
10.12% |
11.17% |
7.42% |
0.61% |
9.55% |
Total Return (1) |
13.36% |
7.40% |
0.47% |
10.48% |
11.60% |
7.50% |
0.61% |
9.87% |
|
|
|
|
|
|
|
|
|
Total loans as of period end: |
|
|
|
|
|
|
|
|
Unpaid principal balance |
$ 234,672 |
$ 92,542 |
$ 60,000 |
$ 387,214 |
$ 221,597 |
$ 64,700 |
$ 24,000 |
$ 310,297 |
Net investment basis |
$ 195,683 |
$ 92,414 |
$ 60,000 |
$ 348,097 |
$ 184,959 |
$ 64,724 |
$ 24,000 |
$ 273,683 |
|
|
|
|
|
|
|
|
|
(1) The total return on purchased
loans represents scheduled accretion, accelerated accretion, gains
on asset sales, and other noninterest income recorded during the
period divided by the average invested balance, on an annualized
basis. |
2. Deposits increased by $23.5 million, or 3.7%, for the
quarter, attributable primarily to growth in non-maturity accounts,
which increased by $20.1 million, or 6.9%, for the three months
ended March 31, 2015, as well as an increase of $3.3 million in
time deposits. For the nine-month period, deposits increased by
$80.8 million, or 14.1%. Growth in both periods was attributable
mainly to increases in money market accounts attracted through the
Bank's online-only ableBanking division.
3. Stockholders' equity increased by $421 thousand from June 30,
2014, due principally to earnings of $5.0 million, as well as $504
thousand of scheduled amortization of stock-based compensation,
offset by $4.4 million in share repurchases (representing 479,936
shares), a decrease in accumulated other comprehensive income of
$365 thousand and $302 thousand in dividends paid on common stock.
During the quarter, there were 31,250 shares repurchased for $291
thousand.
Net income from continuing operations increased by $1.3 million
to $1.8 million for the quarter ended March 31, 2015, compared to
$437 thousand for the quarter ended March 31, 2014.
1. Net interest and dividend income before provision for loan
losses increased by $2.0 million, or 28.2%, for the quarter ended
March 31, 2015 compared to the quarter ended March 31, 2014, due
primarily to higher transactional interest income from purchased
loan payoffs and the positive effect of balance sheet growth.
Average total interest-earning assets for the three months ended
March 31, 2015 increased by $64.6 million, and average loans
increased by $58.9 million, when compared to the three months ended
March 31, 2014. For the nine months ended March 31, 2015, average
total interest-earning assets increased by $66.9 million and
average loans increased by $60.5 million compared to the nine
months ended March 31, 2014.
The various components of transactional income are set forth in
the table below entitled "Total Return on Purchased
Loans." When compared to the three and nine month periods
ended March 31, 2014, transactional interest income increased by
$2.0 million and $3.9 million, respectively. The following
table summarizes interest income and related yields recognized on
the loan portfolios.
|
Interest Income and Yield
on Loans |
|
Three Months Ended March
31, |
|
2015 |
2014 |
|
Average |
Interest |
|
Average |
Interest |
|
|
Balance |
Income |
Yield |
Balance |
Income |
Yield |
|
(Dollars in thousands) |
Community Banking Division |
$ 232,369 |
$ 2,823 |
4.93% |
$ 249,962 |
$ 3,183 |
5.16% |
LASG: |
|
|
|
|
|
|
Originated |
80,567 |
1,127 |
5.67% |
59,526 |
1,020 |
6.95% |
Purchased |
208,487 |
6,614 |
12.87% |
177,559 |
4,164 |
9.51% |
Secured Loans to
Broker-Dealers |
48,551 |
55 |
0.46% |
24,000 |
36 |
0.61% |
Total LASG |
337,605 |
7,796 |
9.37% |
261,085 |
5,220 |
8.11% |
Total |
$ 569,974 |
$ 10,619 |
7.56% |
$ 511,047 |
$ 8,403 |
6.67% |
|
|
|
|
|
|
|
|
Nine Months Ended March
31, |
|
2015 |
2014 |
|
Average |
Interest |
|
Average |
Interest |
|
|
Balance |
Income |
Yield |
Balance |
Income |
Yield |
|
(Dollars in thousands) |
Community Banking Division |
$ 236,584 |
$ 8,782 |
4.94% |
$ 246,539 |
$ 9,809 |
5.30% |
LASG: |
|
|
|
|
|
|
Originated |
66,314 |
3,441 |
6.91% |
45,379 |
2,527 |
7.42% |
Purchased |
206,747 |
20,125 |
12.97% |
175,383 |
14,711 |
11.17% |
Secured Loans to
Broker-Dealers |
39,054 |
139 |
0.47% |
20,890 |
95 |
0.61% |
Total LASG |
312,115 |
23,705 |
10.12% |
241,652 |
17,333 |
9.55% |
Total |
$ 548,699 |
$ 32,487 |
7.89% |
$ 488,191 |
$ 27,142 |
7.41% |
The yield on purchased loans for the three and nine months ended
March 31, 2015 increased primarily due to unscheduled loan payoffs,
which resulted in immediate recognition in interest income of the
discount associated with the prepaid loans. The following table
details the "total return" on purchased loans, which includes
transactional income of $2.7 million for the quarter ended March
31, 2015, an increase of $2.0 million from the quarter ended March
31, 2014. Additionally, total transactional income for the
nine months ended March 31, 2015 increased by $3.8 million,
compared to the nine months ended March 31, 2014. The following
table summarizes the total return recognized on the purchased loan
portfolio.
|
Total Return
on Purchased Loans |
|
Three Months
Ended March 31, |
|
2015 |
2014 |
|
Income |
Return (1) |
Income |
Return (1) |
|
(Dollars in thousands) |
Regularly scheduled interest and
accretion |
$ 4,322 |
8.41% |
$ 3,880 |
8.83% |
Transactional income: |
|
|
|
|
Gains on loan sales |
-- |
0.00% |
349 |
0.79% |
Gain on sale of real estate
owned |
379 |
0.74% |
56 |
0.13% |
Other noninterest income |
-- |
0.00% |
-- |
0.00% |
Accelerated accretion and loan
fees |
2,292 |
4.46% |
284 |
0.65% |
Total transactional income |
2,671 |
5.20% |
689 |
1.57% |
Total |
$ 6,993 |
13.60% |
$ 4,569 |
10.39% |
|
|
|
|
|
|
|
|
|
|
|
Nine Months Ended March
31, |
|
2015 |
2014 |
|
Income |
Return (1) |
Income |
Return (1) |
|
(Dollars in thousands) |
Regularly scheduled interest and
accretion |
$ 13,195 |
8.50% |
$ 11,632 |
8.80% |
Transactional income: |
|
|
|
|
Gains on loan sales |
190 |
0.12% |
576 |
0.44% |
Gain on sale of real estate
owned |
419 |
0.27% |
56 |
0.04% |
Other noninterest income |
-- |
0.00% |
-- |
0.00% |
Accelerated accretion and loan
fees |
6,930 |
4.47% |
3,079 |
2.33% |
Total transactional income |
7,539 |
4.86% |
3,711 |
2.81% |
Total |
$ 20,734 |
13.36% |
$ 15,343 |
11.60% |
|
|
|
|
|
(1) The total return on purchased loans
represents scheduled accretion, accelerated accretion, gains on
asset sales, and other noninterest income recorded during the
period divided by the average invested balance, on an annualized
basis. |
2. Noninterest income increased by $246 thousand for the quarter
ended March 31, 2015, compared to the quarter ended March 31, 2014,
principally due to the following:
- An increase of $192 thousand in gains recognized on Real Estate
Owned/Other Assets Acquired ("REO/OAA");
- An increase of $90 thousand in gains realized on sale of loans
held for sale in the secondary market, due principally to an
increase in purchase-related mortgage loan activity in the current
period;
- An increase of $52 thousand in gains realized on sale of
portfolio loans. The recent quarter includes gains realized on
sale of SBA loans of $425 thousand, compared to zero in the quarter
ended March 31, 2014; and
- A decrease of $82 thousand in fees and other services to
customers, primarily due to a decrease in servicing rights related
to loans paid off or sold.
3. Noninterest expense increased by $369 thousand for the
quarter ended March 31, 2015, compared to the quarter ended March
31, 2014, principally due to the following:
- An increase of $557 thousand in salaries and employee benefits,
principally due to increased employee head count; and
- A decrease of $172 thousand in occupancy and equipment expense,
the result of a reduction in software maintenance and depreciation
expense following the conversion of the Bank's core systems
platform to an outsourced model in May 2014. The decrease in
equipment expense was offset in part by higher data processing
fees, which increased by $104 thousand.
4. The Company's effective tax rate for the quarter ended March
31, 2015 was 36.17%, compared to 39.64% for the quarter ended March
31, 2014. The decrease in the quarter was primarily due to
fluctuations in projected pre-tax income and permanent book to tax
differences for the prior fiscal year.
At March 31, 2015, nonperforming assets totaled $14.1 million,
or 1.7% of total assets, as compared to $9.3 million, or 1.2% of
total assets at June 30, 2014. The increase in nonperforming
assets during the nine months ended March 31, 2015 was mainly due
to the addition of one purchased loan relationship.
At March 31, 2015, the Company's Tier 1 Leverage Ratio was
15.0%, a decrease from 15.9% at June 30, 2014, and the Total
Capital Ratio was 21.2%, a decrease from 23.7% at June 30, 2014.
The decreases resulted primarily from balance sheet growth, risk
weighting adjustment due to the effect of the adoption of Basel
III, and the effect of purchases under the Company's share
repurchase program in the nine months ended March 31, 2015.
Investor Call Information
Richard Wayne, Chief Executive Officer of Northeast Bancorp,
Claire Bean, Chief Operating Officer of Northeast Bancorp, and
Brian Shaughnessy, Chief Financial Officer of Northeast Bancorp,
will host a conference call to discuss third quarter
earnings and business outlook at 10:00 a.m. Eastern Time on Friday,
May 1, 2015. Investors can access the call by dialing
877.878.2762 and entering the following passcode: 34175780. The
call will be available via live webcast, which can be viewed by
accessing the Company's website at www.northeastbank.com and
clicking on the About Us - Investor Relations section. To listen to
the webcast, attendees are encouraged to visit the website at least
fifteen minutes early to register, download and install any
necessary audio software. Please note there will also be a slide
presentation that will accompany the webcast. For those who cannot
listen to the live broadcast, a replay will be available online for
one year at www.northeastbank.com.
About Northeast Bancorp
Northeast Bancorp (Nasdaq:NBN) is the holding company for
Northeast Bank, a full-service bank headquartered in Lewiston,
Maine. Northeast Bank offers traditional banking services through
its Community Banking Division, which operates ten full-service
branches and two loan production offices that serve individuals and
businesses located in western and south-central Maine and southern
New Hampshire. Northeast Bank's Loan Acquisition and Servicing
Group purchases and originates commercial loans for the Bank's
portfolio. In addition, the Small Business Lending division
supports the needs of growing businesses nationally. ableBanking, a
division of Northeast Bank, offers savings products to consumers
online. Information regarding Northeast Bank can be found on its
website at www.northeastbank.com.
Non-GAAP Financial Measure
In addition to results presented in accordance with generally
accepted accounting principles ("GAAP"), this press release
contains certain non-GAAP financial measures, including tangible
common stockholders' equity, tangible book value per share, and net
operating earnings. Northeast's management believes that the
supplemental non-GAAP information is utilized by regulators and
market analysts to evaluate a company's financial condition and
therefore, such information is useful to investors. These
disclosures should not be viewed as a substitute for financial
results determined in accordance with GAAP, nor are they
necessarily comparable to non-GAAP performance measures that may be
presented by other companies. Because non-GAAP financial measures
are not standardized, it may not be possible to compare these
financial measures with other companies' non-GAAP financial
measures having the same or similar names.
Forward-Looking Statements
Statements in this press release that are not historical facts
are forward-looking statements within the meaning of Section 27A of
the Securities Act of 1933, as amended, and Section 21E of the
Securities Exchange Act of 1934, as amended, and are intended to be
covered by the safe harbor provisions of the Private Securities
Litigation Reform Act of 1995. Although Northeast believes that
these forward-looking statements are based on reasonable estimates
and assumptions, they are not guarantees of future performance and
are subject to known and unknown risks, uncertainties, and other
factors. You should not place undue reliance on our forward-looking
statements. You should exercise caution in interpreting and relying
on forward-looking statements because they are subject to
significant risks, uncertainties and other factors which are, in
some cases, beyond the Company's control. The Company's actual
results could differ materially from those projected in the
forward-looking statements as a result of, among other factors,
changes in interest rates and real estate values; competitive
pressures from other financial institutions; the effects of
weakness in general economic conditions on a national basis or in
the local markets in which the Company operates, including changes
which adversely affect borrowers' ability to service and repay our
loans; changes in loan defaults and charge-off rates; changes in
the value of securities and other assets, adequacy of loan loss
reserves, or deposit levels necessitating increased borrowing to
fund loans and investments; increasing government regulation; the
risk that the Company may not be successful in the implementation
of its business strategy; the risk that intangibles recorded in the
Company's financial statements will become impaired; changes in
assumptions used in making such forward-looking statements; and the
other risks and uncertainties detailed in the Company's Annual
Report on Form 10-K and updated by the Company's Quarterly Reports
on Form 10-Q and other filings submitted to the Securities and
Exchange Commission. These statements speak only as of the date of
this release and the Company does not undertake any obligation to
update or revise any of these forward-looking statements to reflect
events or circumstances occurring after the date of this
communication or to reflect the occurrence of unanticipated
events.
NBN-F
|
|
|
|
|
|
NORTHEAST BANCORP AND
SUBSIDIARY |
|
|
CONSOLIDATED BALANCE
SHEETS |
|
|
(Unaudited) |
|
|
(Dollars in thousands, except share and per
share data) |
|
|
|
March 31, 2015 |
June 30, 2014 |
Assets |
|
|
Cash and due from banks |
$ 2,496 |
$ 3,372 |
Short-term investments |
102,577 |
78,887 |
Total cash and cash
equivalents |
105,073 |
82,259 |
|
|
|
Available-for-sale securities, at fair
value |
105,523 |
113,881 |
Loans held for sale |
4,439 |
11,945 |
|
|
|
Loans |
|
|
Commercial real
estate |
327,767 |
316,098 |
Residential real
estate |
136,778 |
148,634 |
Commercial and
industrial |
106,271 |
41,800 |
Consumer |
8,377 |
9,884 |
Total loans |
579,193 |
516,416 |
Less: Allowance for loan
losses |
1,741 |
1,367 |
Loans, net |
577,452 |
515,049 |
|
|
|
Premises and equipment, net |
8,095 |
9,135 |
Real estate owned and other possessed
collateral, net |
3,694 |
1,991 |
Regulatory stock, at cost |
4,102 |
4,102 |
Intangible assets, net |
2,338 |
2,798 |
Bank owned life insurance |
15,165 |
14,836 |
Other assets |
7,047 |
5,935 |
Total assets |
$ 832,928 |
$ 761,931 |
|
|
|
Liabilities and Stockholders' Equity |
|
|
Deposits |
|
|
Demand |
$ 50,870 |
$ 50,140 |
Savings and interest
checking |
98,050 |
98,340 |
Money market |
163,004 |
83,901 |
Time |
343,253 |
341,948 |
Total deposits |
655,177 |
574,329 |
|
|
|
Federal Home Loan Bank advances |
30,216 |
42,824 |
Wholesale repurchase agreements |
10,077 |
10,199 |
Short-term borrowings |
2,861 |
2,984 |
Junior subordinated debentures issued
to affiliated trusts |
8,578 |
8,440 |
Capital lease obligation |
1,416 |
1,558 |
Other liabilities |
12,116 |
9,531 |
Total liabilities |
720,441 |
649,865 |
|
|
|
Commitments and contingencies |
-- |
-- |
|
|
|
Stockholders' equity |
|
|
Preferred stock, $1.00
par value, 1,000,000 shares authorized; no shares issued and
outstanding at March 31, 2015 and June 30, 2014 |
-- |
-- |
Voting common stock,
$1.00 par value, 25,000,000 shares authorized; 8,908,121 and
9,260,331 shares issued and outstanding at March 31, 2015 and June
30, 2014, respectively |
8,908 |
9,260 |
Non-voting common stock,
$1.00 par value, 3,000,000 shares authorized; 911,488 and 880,963
shares issued and outstanding at March 31, 2015 and June 30, 2014,
respectively |
911 |
881 |
Additional paid-in
capital |
87,348 |
90,914 |
Retained earnings |
16,968 |
12,294 |
Accumulated other
comprehensive income (loss) |
(1,648) |
(1,283) |
Total stockholders'
equity |
112,487 |
112,066 |
Total liabilities and
stockholders' equity |
$ 832,928 |
$ 761,931 |
|
|
|
|
|
|
|
|
|
|
NORTHEAST BANCORP AND
SUBSIDIARY |
|
|
|
|
CONSOLIDATED STATEMENTS OF
INCOME |
|
|
|
|
(Unaudited) |
|
|
|
|
(Dollars in thousands, except share and per
share data) |
|
|
|
|
|
Three Months Ended March
31, |
Nine Months Ended March
31, |
|
2015 |
2014 |
2015 |
2014 |
Interest and dividend income: |
|
|
|
|
Interest and fees on
loans |
$ 10,619 |
$ 8,403 |
$ 32,487 |
$ 27,142 |
Interest on
available-for-sale securities |
222 |
253 |
697 |
797 |
Other interest and
dividend income |
72 |
61 |
218 |
208 |
Total interest and
dividend income |
10,913 |
8,717 |
33,402 |
28,147 |
|
|
|
|
|
Interest expense: |
|
|
|
|
Deposits |
1,271 |
1,022 |
3,681 |
3,048 |
Federal Home Loan Bank
advances |
257 |
324 |
845 |
975 |
Wholesale repurchase
agreements |
71 |
93 |
216 |
285 |
Short-term
borrowings |
5 |
6 |
21 |
17 |
Junior subordinated
debentures issued to affiliated trusts |
171 |
140 |
566 |
525 |
Obligation under capital
lease agreements |
18 |
20 |
56 |
63 |
Total interest
expense |
1,793 |
1,605 |
5,385 |
4,913 |
|
|
|
|
|
Net interest and dividend income before
provision for loan losses |
9,120 |
7,112 |
28,017 |
23,234 |
Provision for loan losses |
44 |
180 |
477 |
407 |
Net interest and dividend income after
provision for loan losses |
9,076 |
6,932 |
27,540 |
22,827 |
|
|
|
|
|
Noninterest income: |
|
|
|
|
Fees for other services
to customers |
303 |
385 |
1,089 |
1,246 |
Gain on sales of loans
held for sale |
355 |
265 |
1,384 |
1,145 |
Gain on sales of
portfolio loans |
425 |
373 |
950 |
603 |
Gain recognized on real
estate owned and other repossessed collateral, net |
357 |
165 |
303 |
50 |
Bank-owned life insurance
income |
110 |
108 |
329 |
342 |
Other noninterest
income |
4 |
12 |
23 |
46 |
Total noninterest
income |
1,554 |
1,308 |
4,078 |
3,432 |
|
|
|
|
|
Noninterest expense: |
|
|
|
|
Salaries and employee
benefits |
4,316 |
3,759 |
13,586 |
12,624 |
Occupancy and equipment
expense |
1,278 |
1,450 |
3,662 |
4,075 |
Professional fees |
386 |
366 |
1,153 |
1,115 |
Data processing fees |
361 |
257 |
1,029 |
770 |
Marketing expense |
54 |
86 |
203 |
225 |
Loan acquisition and
collection expense |
409 |
440 |
1,096 |
1,203 |
FDIC insurance
premiums |
137 |
127 |
371 |
354 |
Intangible asset
amortization |
128 |
162 |
460 |
582 |
Legal settlement
recovery |
-- |
-- |
-- |
(250) |
Other noninterest
expense |
816 |
869 |
2,272 |
2,284 |
Total noninterest
expense |
7,885 |
7,516 |
23,832 |
22,982 |
|
|
|
|
|
Income from continuing operations before
income tax expense |
2,745 |
724 |
7,786 |
3,277 |
Income tax expense |
993 |
287 |
2,810 |
1,119 |
Net income from continuing operations |
1,752 |
437 |
4,976 |
2,158 |
|
|
|
|
|
Income from discontinued operations before
tax (benefit) expense |
-- |
-- |
-- |
(12) |
Income tax (benefit) expense |
-- |
-- |
-- |
(4) |
Net (loss) income from discontinued
operations |
-- |
-- |
-- |
(8) |
Net income |
$ 1,752 |
$ 437 |
$ 4,976 |
$ 2,150 |
|
|
|
|
|
Weighted-average shares outstanding: |
|
|
|
|
Basic |
9,833,033 |
10,432,494 |
10,049,983 |
10,435,300 |
Diluted |
9,833,033 |
10,432,494 |
10,049,983 |
10,435,300 |
Earnings per common share: |
|
|
|
|
Basic: |
|
|
|
|
Income from continuing
operations |
$ 0.18 |
$ 0.04 |
$ 0.50 |
$ 0.21 |
Income from discontinued
operations |
0.00 |
0.00 |
0.00 |
0.00 |
Net Income |
$ 0.18 |
$ 0.04 |
$ 0.50 |
$ 0.21 |
Diluted: |
|
|
|
|
Income from continuing
operations |
$ 0.18 |
$ 0.04 |
$ 0.50 |
$ 0.21 |
Income from discontinued
operations |
0.00 |
0.00 |
0.00 |
0.00 |
Net Income |
$ 0.18 |
$ 0.04 |
$ 0.50 |
$ 0.21 |
Cash dividends declared per common share |
$ 0.01 |
$ 0.09 |
$ 0.03 |
$ 0.27 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
NORTHEAST BANCORP AND
SUBSIDIARY |
|
|
|
|
|
CONSOLIDATED AVERAGE
BALANCE SHEETS AND ANNUALIZED YIELDS |
|
|
|
(Unaudited) |
|
|
|
|
|
|
(Dollars in thousands) |
|
|
|
|
|
|
|
Three Months Ended March
31, |
|
2015 |
2014 |
|
|
Interest |
Average |
|
Interest |
Average |
|
Average |
Income/ |
Yield/ |
Average |
Income/ |
Yield/ |
|
Balance |
Expense |
Rate |
Balance |
Expense |
Rate |
Assets: |
|
|
|
|
|
|
Interest-earning assets: |
|
|
|
|
|
|
Investment securities (1) |
$ 107,010 |
$ 222 |
0.84% |
$ 114,925 |
$ 253 |
0.89% |
Loans (2) (3) |
569,974 |
10,619 |
7.56% |
511,047 |
8,403 |
6.67% |
Regulatory stock |
4,102 |
18 |
1.78% |
5,721 |
16 |
1.13% |
Short-term investments (4) |
90,722 |
54 |
0.24% |
75,506 |
45 |
0.24% |
Total interest-earning assets |
771,808 |
10,913 |
5.73% |
707,199 |
8,717 |
5.00% |
Cash and due from banks |
2,919 |
|
|
2,833 |
|
|
Other non-interest earning assets |
33,069 |
|
|
37,366 |
|
|
Total assets |
$ 807,796 |
|
|
$ 747,398 |
|
|
|
|
|
|
|
|
|
Liabilities & Stockholders' Equity: |
|
|
|
|
|
|
Interest-bearing liabilities: |
|
|
|
|
|
|
NOW accounts |
$ 62,317 |
$ 39 |
0.25% |
$ 61,028 |
$ 40 |
0.27% |
Money market accounts |
153,487 |
300 |
0.79% |
87,352 |
112 |
0.52% |
Savings accounts |
34,140 |
11 |
0.13% |
35,052 |
12 |
0.14% |
Time deposits |
328,633 |
921 |
1.14% |
325,505 |
858 |
1.07% |
Total interest-bearing
deposits |
578,577 |
1,271 |
0.89% |
508,917 |
1,022 |
0.81% |
Short-term
borrowings |
2,356 |
5 |
0.86% |
2,192 |
6 |
1.11% |
Borrowed funds |
43,718 |
346 |
3.21% |
59,399 |
437 |
2.98% |
Junior subordinated
debentures |
8,553 |
171 |
8.11% |
8,374 |
140 |
6.78% |
Total interest-bearing liabilities |
633,204 |
1,793 |
1.15% |
578,882 |
1,605 |
1.12% |
|
|
|
|
|
|
|
Non-interest bearing liabilities: |
|
|
|
|
|
|
Demand deposits and escrow accounts |
54,647 |
|
|
48,361 |
|
|
Other liabilities |
8,516 |
|
|
5,920 |
|
|
Total liabilities |
696,367 |
|
|
633,163 |
|
|
Stockholders' equity |
111,429 |
|
|
114,325 |
|
|
Total liabilities and stockholders'
equity |
$ 807,796 |
|
|
$ 747,398 |
|
|
|
|
|
|
|
|
|
Net interest income |
|
$ 9,120 |
|
|
$ 7,112 |
|
|
|
|
|
|
|
|
Interest rate spread |
|
|
4.58% |
|
|
3.88% |
Net interest margin (5) |
|
|
4.79% |
|
|
4.08% |
|
|
|
|
|
|
|
(1) Interest income and
yield are stated on a fully tax-equivalent basis using a 34% tax
rate. |
(2) Includes loans held for
sale. |
(3) Nonaccrual loans are
included in the computation of average, but unpaid interest has not
been included for purposes of determining interest income. |
(4) Short term investments
include FHLB overnight deposits and other interest-bearing
deposits. |
(5) Net interest margin is
calculated as net interest income divided by total interest-earning
assets. |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
NORTHEAST BANCORP AND
SUBSIDIARY |
CONSOLIDATED AVERAGE
BALANCE SHEETS AND ANNUALIZED YIELDS |
(Unaudited) |
(Dollars in thousands) |
|
Nine Months Ended March
31, |
|
2015 |
2014 |
|
|
Interest |
Average |
|
Interest |
Average |
|
Average |
Income/ |
Yield/ |
Average |
Income/ |
Yield/ |
|
Balance |
Expense |
Rate |
Balance |
Expense |
Rate |
Assets: |
|
|
|
|
|
|
Interest-earning assets: |
|
|
|
|
|
|
Investment securities (1) |
$ 109,605 |
$ 697 |
0.85% |
$ 117,053 |
$ 797 |
0.91% |
Loans (2) (3) |
548,699 |
32,487 |
7.89% |
488,191 |
27,142 |
7.41% |
Regulatory stock |
4,102 |
49 |
1.59% |
5,721 |
68 |
1.58% |
Short-term investments (4) |
92,784 |
169 |
0.24% |
77,334 |
140 |
0.24% |
Total interest-earning assets |
755,190 |
33,402 |
5.89% |
688,299 |
28,147 |
5.45% |
Cash and due from banks |
2,755 |
|
|
2,975 |
|
|
Other non-interest earning assets |
33,241 |
|
|
35,855 |
|
|
Total assets |
$ 791,186 |
|
|
$ 727,129 |
|
|
|
|
|
|
|
|
|
Liabilities & Stockholders' Equity: |
|
|
|
|
|
|
Interest-bearing liabilities: |
|
|
|
|
|
|
NOW accounts |
$ 62,731 |
$ 121 |
0.26% |
$ 59,703 |
$ 120 |
0.27% |
Money market accounts |
122,165 |
665 |
0.73% |
86,421 |
338 |
0.52% |
Savings accounts |
34,049 |
34 |
0.13% |
34,160 |
35 |
0.14% |
Time deposits |
339,116 |
2,861 |
1.12% |
306,423 |
2,555 |
1.11% |
Total interest-bearing
deposits |
558,061 |
3,681 |
0.88% |
486,707 |
3,048 |
0.83% |
Short-term
borrowings |
2,852 |
21 |
0.98% |
2,290 |
17 |
0.99% |
Borrowed funds |
47,455 |
1,117 |
3.14% |
59,778 |
1,323 |
2.95% |
Junior subordinated
debentures |
8,507 |
566 |
8.86% |
8,331 |
525 |
8.39% |
Total interest-bearing liabilities |
616,875 |
5,385 |
1.16% |
557,106 |
4,913 |
1.17% |
|
|
|
|
|
|
|
Non-interest bearing liabilities: |
|
|
|
|
|
|
Demand deposits and escrow accounts |
54,339 |
|
|
50,662 |
|
|
Other liabilities |
7,644 |
|
|
5,718 |
|
|
Total liabilities |
678,858 |
|
|
613,486 |
|
|
Stockholders' equity |
112,328 |
|
|
113,643 |
|
|
Total liabilities and stockholders'
equity |
$ 791,186 |
|
|
$ 727,129 |
|
|
|
|
|
|
|
|
|
Net interest income |
|
$ 28,017 |
|
|
$ 23,234 |
|
|
|
|
|
|
|
|
Interest rate spread |
|
|
4.73% |
|
|
4.28% |
Net interest margin (5) |
|
|
4.94% |
|
|
4.50% |
|
|
|
|
|
|
|
(1) Interest income and
yield are stated on a fully tax-equivalent basis using a 34% tax
rate. |
(2) Includes loans held for
sale. |
(3) Nonaccrual loans are
included in the computation of average, but unpaid interest has not
been included for purposes of determining interest income. |
(4) Short term investments
include FHLB overnight deposits and other interest-bearing
deposits. |
(5) Net interest margin is
calculated as net interest income divided by total interest-earning
assets. |
|
|
|
|
|
|
|
|
|
|
|
|
NORTHEAST BANCORP AND
SUBSIDIARY |
|
|
|
|
|
SELECTED CONSOLIDATED FINANCIAL
HIGHLIGHTS AND OTHER DATA |
|
|
|
|
|
(Unaudited) |
|
|
|
|
|
(Dollars in thousands, except share and per
share data) |
|
|
|
|
|
|
Three Months Ended: |
|
March 31, 2015 |
December 31, 2014 |
September 30, 2014 |
June 30, 2014 |
March 31, 2014 |
Net interest income |
$ 9,120 |
$ 9,426 |
$ 9,471 |
$ 8,484 |
$ 7,112 |
Provision for loan losses |
44 |
113 |
320 |
124 |
180 |
Noninterest income |
1,554 |
1,370 |
1,154 |
1,437 |
1,308 |
Noninterest expense |
7,885 |
8,210 |
7,737 |
8,795 |
7,516 |
Net income from continuing operations |
1,752 |
1,580 |
1,644 |
542 |
437 |
Net income |
1,752 |
1,580 |
1,644 |
542 |
437 |
|
|
|
|
|
|
Weighted average common shares
outstanding: |
|
|
|
|
|
Basic |
9,833,033 |
10,132,349 |
10,180,038 |
10,314,197 |
10,432,494 |
Diluted |
9,833,033 |
10,132,349 |
10,180,038 |
10,314,197 |
10,432,494 |
Earnings per common share: |
|
|
|
|
|
Basic |
$ 0.18 |
$ 0.16 |
$ 0.16 |
$ 0.05 |
$ 0.04 |
Diluted |
0.18 |
0.16 |
0.16 |
0.05 |
0.04 |
Dividends per common share |
0.01 |
0.01 |
0.01 |
0.01 |
0.09 |
|
|
|
|
|
|
Return on average assets |
0.88% |
0.78% |
0.85% |
0.29% |
0.24% |
Return on average equity |
6.38% |
5.54% |
5.80% |
1.98% |
1.55% |
Net interest rate spread (1) |
4.59% |
4.65% |
4.95% |
4.53% |
3.87% |
Net interest margin (2) |
4.79% |
4.87% |
5.18% |
4.75% |
4.08% |
Efficiency ratio (3) |
73.87% |
76.05% |
72.82% |
88.65% |
89.26% |
Noninterest expense to average total
assets |
3.96% |
4.05% |
4.02% |
4.69% |
4.08% |
Average interest-earning assets to average
interest-bearing liabilities |
121.89% |
122.32% |
123.09% |
121.92% |
122.17% |
|
|
|
|
|
|
|
As of: |
|
March 31, 2015 |
December 31, 2014 |
September 30, 2014 |
June 30, 2014 |
March 31, 2014 |
Nonperforming loans: |
|
|
|
|
|
Originated portfolio: |
|
|
|
|
|
Residential real estate |
$ 3,163 |
$ 2,706 |
$ 2,105 |
$ 1,743 |
$ 1,678 |
Commercial real estate |
1,201 |
1,166 |
721 |
1,162 |
798 |
Home equity |
11 |
11 |
28 |
160 |
214 |
Commercial business |
-- |
-- |
-- |
5 |
-- |
Consumer |
225 |
237 |
145 |
139 |
152 |
Total originated portfolio |
4,600 |
4,120 |
2,999 |
3,209 |
2,842 |
Total purchased portfolio |
5,850 |
8,129 |
4,287 |
4,116 |
4,582 |
Total nonperforming loans |
10,450 |
12,249 |
7,286 |
7,325 |
7,424 |
Real estate owned and other possessed
collateral, net |
3,694 |
2,058 |
2,115 |
1,991 |
2,000 |
Total nonperforming assets |
$
14,144 |
$ 14,307 |
$ 9,401 |
$ 9,316 |
$ 9,424 |
|
|
|
|
|
|
Past due loans to total loans |
2.57% |
2.64% |
1.40% |
1.14% |
1.44% |
Nonperforming loans to total loans |
1.80% |
2.13% |
1.34% |
1.42% |
1.44% |
Nonperforming assets to total assets |
1.70% |
1.77% |
1.20% |
1.22% |
1.26% |
Allowance for loan losses to total loans |
0.30% |
0.29% |
0.28% |
0.26% |
0.26% |
Allowance for loan losses to nonperforming
loans |
16.66% |
13.58% |
21.12% |
18.66% |
18.12% |
|
|
|
|
|
|
Commercial real estate loans to risk-based
capital (4) |
173.17% |
190.05% |
167.57% |
176.98% |
175.10% |
Net loans to core deposits (5) |
89.04% |
91.79% |
92.80% |
92.13% |
93.18% |
Purchased loans to total loans, including
held for sale |
33.53% |
37.97% |
37.38% |
38.51% |
35.29% |
Equity to total assets |
13.51% |
13.69% |
14.48% |
14.71% |
15.18% |
Common equity tier 1 capital ratio |
20.90% |
-- |
-- |
-- |
-- |
Total capital ratio (7) |
21.21% |
21.44% |
22.97% |
23.69% |
24.21% |
Tier 1 leverage capital ratio |
14.96% |
14.81% |
15.89% |
15.90% |
16.28% |
|
|
|
|
|
|
Total stockholders' equity |
$ 112,487 |
$ 110,923 |
$ 113,242 |
$ 112,066 |
$ 114,008 |
Less: Preferred stock |
-- |
-- |
-- |
-- |
-- |
Common stockholders' equity |
112,487 |
110,923 |
113,242 |
112,066 |
114,008 |
Less: Intangible assets |
(2,338) |
(2,466) |
(2,632) |
(2,798) |
(2,962) |
Tangible common stockholders' equity
(non-GAAP) |
$ 110,149 |
$ 108,457 |
$ 110,610 |
$ 109,268 |
$ 111,046 |
|
|
|
|
|
|
Common shares outstanding |
9,819,609 |
9,846,387 |
10,248,034 |
10,141,294 |
10,432,494 |
Book value per common share |
$ 11.46 |
$ 11.27 |
$ 11.05 |
$ 11.05 |
$ 10.93 |
Tangible book value per share (non-GAAP)
(6) |
11.22 |
11.01 |
10.79 |
10.77 |
10.64 |
|
|
|
|
|
|
|
Reconciliation of Net
Income (GAAP) to Net Operating Earnings (non-GAAP) |
|
Three Months Ended: |
|
March 31, 2015 |
December 31, 2014 |
September 30, 2014 |
June 30, 2014 |
March 31, 2014 |
Net income (GAAP) |
$ 1,752 |
$ 1,580 |
$ 1,644 |
$ 542 |
$ 437 |
Items excluded from operating
earnings, net of tax: |
|
|
|
|
|
Discontinued operations |
-- |
-- |
-- |
-- |
-- |
Severance expense |
8 |
36 |
52 |
407 |
35 |
Income from life insurance
death benefits |
-- |
-- |
-- |
148 |
84 |
Legal settlement expense and
related professional fees |
-- |
-- |
-- |
-- |
-- |
Total after-tax items |
8 |
36 |
52 |
555 |
119 |
Net operating earnings (non-GAAP) |
$
1,760 |
$ 1,616 |
$ 1,696 |
$ 1,097 |
$ 556 |
Net operating earnings per share - basic
(non-GAAP) |
$ 0.18 |
$ 0.16 |
$ 0.17 |
$ 0.11 |
$ 0.05 |
|
|
|
|
|
|
(1) The net interest rate spread
represents the difference between the weighted-average yield on
interest-earning assets and the weighted-average cost of
interest-bearing liabilities for the period. |
(2) The net interest margin
represents net interest income as a percent of average
interest-earning assets for the period. |
(3) The efficiency ratio
represents non-interest expense divided by the sum of net interest
income (before the loan loss provision) plus non-interest
income. |
(4) For purposes of calculating
this ratio, commercial real estate includes all those loans defined
as such by regulatory guidance, including all land development and
construction loans. |
(5) Core deposits include all
non-maturity deposits and maturity deposits less than $250
thousand. Loans include loans held-for-sale. |
(6) Tangible book value per share
represents total stockholders' equity less the sum of preferred
stock and intangible assets divided by common shares
outstanding. |
(7) The Company's adoption of
Basel III went into effect as of March 31, 2015. The previous
period ratios are the "Total Risk-Based Capital Ratio." |
CONTACT: Claire S. Bean, COO
Northeast Bank, 500 Canal Street, Lewiston, ME 04240
207.786.3245 ext. 3202
www.northeastbank.com
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